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TMI Blog2024 (10) TMI 1183X X X X Extracts X X X X X X X X Extracts X X X X ..... t of "HI A MMT Pvt. Ltd." executed a Coal Mine Development and Production Agreement dated 2nd March, 2015 with the appellant/ Nominated Authority of the Ministry of Coal, Government of India in respect of allocation and development of Ardhagram coal mine. Clause 24.3.3 of the Coal Mine Agreement provided for forfeiture of the Performance Bank Guarantee (for short 'PBG') in the event of termination of the Agreement by Respondent. 3. On 31st December, 2021, the appellant issued a communication terminating the Coal Mine Agreement for breach of its terms, specifically the non-renewal of the PBG for an amount of Rs. 92,25,20,000/-, which had lapsed on 20th March, 2021, as per Clause 6.15 of the said Agreement. The Resolution Professional challenged the appellant's decision to terminate the Coal Mine Agreement before the National Company Law Tribunal (for short 'NCLT'), which was dismissed by the order dated 7th February, 2023 passed in IA (IB) No. 15/CB/2022. Thereafter, an appeal was preferred before the National Company Law Appellate Tribunal (for short 'NCLAT') wherein interim order dated 24th January, 2022 was restored thereby staying the operation of the Termination Order. 4. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the incremental fixed cost of Rs. 9,21,44,029/-which allegedly remained unsettled by the respondent. 8. Being aggrieved, the respondent filed the underlying writ petition challenging the decision of the appellant dated 22nd May, 2024. The basis for such challenge was that the respondent, having undergone the CIRP, must not be held liable for past dues, which stood addressed in the Resolution Plan. The appellant, on the other hand, maintained that its claims have survived the insolvency proceedings, as noted in the Resolution Plan, thus the disqualification of the respondent is consistent with their established policy and tender conditions requiring the bidders to clear all past dues. 9. The limited question before the learned Single Judge was whether the respondent was liable for the alleged dues, thereby ascertaining its eligibility to participate in the coal mine auctions. Vide impugned judgement dated 26th July, 2024, learned Single Judge had set aside the decision of the appellant dated 22nd May, 2024 disqualifying the respondent from participating in coal mine auctions until outstanding dues are cleared, and held that the respondent cannot be held accountable for liabilitie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment were specifically not waived. He argued that at the time of approval of the Resolution Plan, the NCLT was aware of the claims of the appellant and had denied the waiver of such claims which was sought by the respondent. In other words, he contended that the NCLT had acknowledged the claims of the appellant. Premised thereon, Mr. Singh vociferously contended that the claims of the appellant are still alive and actionable. He further argued that by ignoring the said legal position, the learned Single Judge committed an error in fact and in law too. In support of the said contention, attention of this Court was invited to the Resolution Plan, particularly, para 13 titled as 'Concessions, Reliefs and Dispensation Sought' to submit that the respondent unconditionally confirmed and undertook that the said Plan would not be conditional on any reliefs, waivers and concessions and that the said Plan would remain unaffected even if any relief, waiver or concession is not granted by the NCLT. In conjunction therewith, he referred to sub-para 30 of para 13 of the said Resolution Plan wherein, the respondent prayed for waiver of compensation of Rs. 9.21 crores and Rs. 92.25 crores due and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s; (iii) list of assets and liabilities as on the initiation date; and (iv) such other matters as may be specified; (b) receive and collate all the claims submitted by creditors to him, pursuant to the public announcement made under Sections 13 and 15; (c) constitute a Committee of Creditors; (d) monitor the assets of the corporate debtor and manage its operations until a resolution professional is appointed by the Committee of Creditors; (e) file information collected with the information utility, if necessary; and (f) take control and custody of any asset over which the corporate debtor has ownership rights as recorded in the balance sheet of the corporate debtor, or with information utility or the depository of securities or any other registry that records the ownership of assets including- (i) assets over which the corporate debtor has ownership rights which may be located in a foreign country; (ii) assets that may or may not be in possession of the corporate debtor; (iii) tangible assets, whether movable or immovable; (iv) intangible assets including intellectual property; (v) securities including shares held in any subsidiary of the corporate debtor, f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, it affected its right of being served notice of the meeting of the CoC, available under Section 24(3)(c) IBC to an operational creditor with aggregate dues of not less than ten per cent of the debt and, secondly, in the proposed plan, outlay for the appellant got reduced, being a percentage of the dues payable. In our view, for the reasons above, the resolution plan stood vitiated. However, neither NCLT nor NCLAT addressed itself on the aforesaid aspects which render their orders vulnerable and amenable to judicial review." (iii) UOI vs. Jor Bagh Asscn. Regd., 2012 SCC OnLine Del 1230 "76. The argument that where the demands were created but not enforced, and the period of limitation to recover the same has expired, to permit the lessor to recover the same as a condition for conversion would breach the well-recognized jurisprudential principle that what cannot be done directly cannot be done indirectly, as observed and applied in the decision reported as JT 2009 (10) SC 645 Subhash Chandra v. Delhi Subordinate Services Selection Board, has no application on the subject at hand, for the reason it is settled law that where the bar of limitation prevents a person from suing to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Limited vs. Edelweiss Asset Reconstruction Co. Ltd. & Ors., (2021) 9 SCC 657. Predicated upon the same, he contended that the appellant cannot put any fretters, obstacles or impediments in the way of the respondent from participating in the prospective coal mine auction process, if otherwise eligible. He prayed that the appeal be dismissed with heavy costs. ANALYSIS AND CONCLUSION:- 20. This Court has heard Mr. Kirtiman Singh, learned counsel for the appellant, Mr. Sandeep Sethi, learned senior counsel for the respondent, considered the records of the case as well as the judgements relied upon. 21. Upon perusal of the records and after hearing the submissions of learned counsel for the parties, it is manifest that one of the claims of the appellant respecting dues towards the prior allottee of the Ardhagram Coal Mine to the extent of Rs. 9.21 crores was included in the Resolution Plan. Undeniably, this claim was calculated at Rs. 49,262/- representing 0.051% of the admitted amount and disbursed by the Resolution Applicant on 3rd May, 2023. As per the records, this transaction had failed and the said amount was finally remitted into the account only on 26th March, 2024. Thus, so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra (supra). The relevant paragraph of the same is reproduced hereunder: "93. As discussed hereinabove, one of the principal objects of the I&B Code is providing for revival of the corporate debtor and to make it a going concern. The I&B Code is a complete Code in itself. Upon admission of petition under Section 7 there are various important duties and functions entrusted to RP and CoC. RP is required to issue a publication inviting claims from all the stakeholders. He is required to collate the said information and submit necessary details in the information memorandum. The resolution applicants submit their plans on the basis of the details provided in the information memorandum. The resolution plans undergo deep scrutiny by RP as well as CoC. In the negotiations that may be held between CoC and the resolution applicant, various modifications may be made so as to ensure that while paying part of the dues of financial creditors as well as operational creditors and other stakeholders, the corporate debtor is revived and is made an on-going concern. After CoC approves the plan, the adjudicating authority is required to arrive at a subjective satisfaction that the plan conforms to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aims are flung or sprung upon it, lest the entire effort of revitalizing and restarting the Corporate Debtor are wasted. In view of the avowed principle too, this Court finds no reason to interfere with the impugned judgement. 27. In so far as the case of Swiss Ribbons Pvt. Ltd. (supra) is concerned, there is no quarrel with the proposition that the Resolution Professional does not play any adjudicatory role. However, in the present case, the appellant, as noticed above, on facts, has permitted time to intervene and extinguish its right to claim. That apart, the appellant did not take any steps to challenge the Resolution Plan at all. Thus, the ratio of this judgement does not assist the case of the appellant. 28. In the case of Greater Noida Industrial Development Authority (supra), the Supreme Court was considering a dispute similar to the one in the present case, except, in that case, the aggrieved person therein challenged the Resolution Plan itself and the Supreme Court held that the form in which the claim was submitted with the Resolution Professional is inconsequential so long as a proper claim is laid. It further held that what needed to be considered respecting such cla ..... X X X X Extracts X X X X X X X X Extracts X X X X
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